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2015 (2) TMI 313 - AT - Income TaxDeduction under provision of section 54F disallowed - long term capital gain on account of sale of shares of Hindustan Platinum Private Limited invested for acquisition of rights in a property - How the constructed building can be sold without ownership of the land being transferred? - Held that:- The land is an independent and identifiable capital asset, which can be separate from superstructure built up on it. A person can be the owner of a superstructure and can earn income separately from such a superstructure, either in the form of rent or by gain on selling it. It is not necessary that the assessee should hold the exclusive right on the land while purchasing the house or vice versa. Such kind of arrangement always happen in the case of lease land. Therefore, we are unable to agree with the contention of the department that, simply because the property has been sold without the transferring the right in the land, the same cannot be held to be sale of property. - Decided in favour of assessee. Eligibility for claim of deduction u/s 54F is only on the purchase of a new and separate house rather than purchasing the shares / fractional interest in a property wherein the assessee himself is one of the co-sharers - Held that:- Sale proceeds invested for purchase of interest in the residential house owned by the assessee’s husband and son, amounts to purchase and hence entitled for exemption u/s 54F. Section 54F, per se, does not prohibit or bar that fractional interest or share in the property, which has been purchased, will not be entitled for deduction u/s 54F. Thus, following the said proposition we hold that the assessee is eligible for deduction u/s 54F on the amount spent on acquisition of rights in a property from the other members of the family or HUF. - Decided in favour of assessee. MoU, through which the assessee had acquired the rights in the property, has not been registered - Held that:- For the purpose of attracting the provisions of section 54, it was not necessary that the assessee should become owner of the property on only through registration, as the section speaks of “purchase” and registration of document was not imperative. Thus, on all counts, the reasoning given by the A.O. as well as CIT(A) cannot be sustained in view of the aforesaid legal proposition discussed above. Accordingly, we hold that the assessee is eligible for claim of deduction of ₹ 60,95,000 u/s 54F in purchase of acquiring one half share of the residential house owned by Smt.Indrani Chandrakant Choksi, one of the members of the assessee-HUF. - Decided in favour of assessee.
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